The chip has helped AMD finally turn the corner and return to profitability. (Source: Maximum PC)

(Source: Comic Vine)

Once troubled chipmaker appears to be turning the corner thanks to GPUs and CPU/GPU "Fusion" combos

Advanced
Micro Devices, Inc.'s (AMD) 2006 purchase of ATI
Technologies for $5.4B USD was widely criticized and scrutinized at
the time. But it now appears that it may have saved the company.

After a couple
years of losses, AMD finally appears to be turning the corner this
year. The company reported [press release] an impressive net
income of $510M USD on revenue of $1.61B USD. Its operating income was
$54M USD and its non-GAAP income was $54M USD.

OEMs appear to be embracing the chip. Acer, Asus, Dell, Fujitsu, HP,
Lenovo, MSI, Sony and Toshiba have all launched Fusion designs. And the
chips are also becoming popular in the embedded sector for devices like casino
machines, which need a more power GPU to drive a large screen. Fujitsu,
Kontron, Quixant and Congatec are all pushing embedded applications of Fusion
chips.

Thomas Seifert, CFO and interim CEO, elates, "First
quarter operating results were highlighted by strong demand for our first
generation of AMD Fusion Accelerated Processing Units (APUs). APU unit
shipments greatly exceeded our expectations, and we are excited to build on
that momentum now that we are shipping our 'Llano' APU."

The Fusion chips are proving so popular for several regions. First, AMD
has priced them very competitively, so they're winding up in very affordable
laptop designs. Secondly, the chips are
very power efficient. And finally they offer a nice performance
blend, offering sufficient CPU performance and relatively powerful GPU
performance.

By contrast Intel Corp.'s (INTC) latest design Sandy
Bridge, also packs an on-die CPU/GPU pairing. But the onboard GPU is
significantly weaker, the power consumption is higher, and the chip is more
expensive. Thus while it is solution of choice for high-power enthusiast
desktops and laptops, it's less than optimal for the much larger budget
laptop/desktop market.

A common criticism leveled against Fusion is that having a discrete GPU in a
budget design is superfluous. However, for Blu-ray playback or playing
popular older video games like World of Warcraft, customers definitely
come to appreciate the benefits of the design.

It appears that AMD is, at the moment, out-competing Intel much in the same way
it outcompeted graphics chipmaker NVIDIA Corp. (NVDA) -- by attacking the low
end. Of course, AMD's growing Fusion sales likely would not have been
possible were it not for new
scrutiny from U.S. and European antitrust regulators that forced Intel
to stop paying off OEMs to ignore AMD designs.

But at the end of the day, though, even in the face of these issues and bigger questions
loom about the future of x86 processors as a whole, AMD looks much better
positioned to be competitive with Intel. And all of that comes back to
the increasing returns from its strong GPU division.

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This article is over a month old, voting and posting comments is disabled

While it certainly isn't an easy task to take on, the split of AMD and GlobalFoundries is exactly what was needed for the GF part to invest heavily in new manufacturing processes. ATIC (GF's owners with AMD) isn't exactly short on funds so they have the money to throw around to try and play catch up to Intel (and maybe even one day surpass them on processes).

And as for architecture, while Intel certainly has some nice artchitecture currently, AMD has proven in the past that they can pull some nice designs that can outcompete intel's. The last decade, they've been mostly held up by their process and some bad execution so if GF can get them on the same ground as Intel process-wise, it'd be interesting to see who can come up with the better designs. I'd be expecting an NVIDIA/ATI situation where one company has the lead for a few generation of products with market disruptions every few years that see a change in leadership. The next few years should be interesting.